INDUSTRY BRIEFS

EXPLORATION

HOWELL CORP.,

Houston, signed final contracts to begin a 3D seismic program on 150 sq miles in the Horseshoe atoll area of the Permian basin in West Texas. Shooting of the first line is to start this week, and Howell expects to start drilling in third quarter. Howell said using 3-D seismic technology to define Pennsylvanian Canyon pinnacle reefs has yielded an 80% success rate in the area the past 2 years.

OCCIDENTAL PETROLEUM (MALAYSIA) LTD.'S

1 Selasih wildcat on Block SK-8 off Bintulu, Malaysia, flowed at a rate of 41.9 MMcfd of gas and 283 b/d of 45 gravity condensate through a 2 in. choke from reef pay at 4,331-4,528 ft. The gas contains about 2% CO2 and no hydrogen sulfide. The well, in 289 ft of water, is about 70 miles southeast of Jintan gas field, discovered in April 1992 (OGJ, May 4, 1992, p. 56).

PETROCHEMICALS

EXXON CO. U.S.A.

let contract to Jacobs Engineering Group Inc., Pasadena, Calif., to oversee engineering and construction of process units for a 2,000-4,000 b/sd methyl tertiary butyl ether plant at its 128,000 b/cd Benicia, Calif., refinery. The MTBE unit is expected to be in service in 14-18 months.

ARCADIAN PARTNERS LP,

Memphis, plans to acquire BP Chemical Inc.'s Lima, Ohio, nitrogen chemicals complex for about $100 million subject to a definitive agreement. BP will operate the complex, which includes ammonia, urea, nitric acid, and solution blending facilities.

COMPANIES

SCHLUMBERGER LTD.

completed the purchase of Dow Chemical Co.'s 50% interest in the Dowell Schlumberger group of companies for $675 million plus a warrant to purchase 7.5 million shares of Schlumberger stock with an exercise price of $59.95/share (OGJ, Dec. 14, 1992, p. 31).

W.R. GRACE & CO.,

Boca Raton, Fla., completed the sale of Grace Petroleum Corp. for total proceeds of $163 million in two transactions (OGJ, Jan. 18, p. 28). An undisclosed party purchased the stock of Grace Petroleum for $125 million, and Sonat Exploration Co., Houston, purchased Grace Petroleum's assets in East Texas for $38 million. Grace Petroleum's interest in one undisclosed field was excluded from the transactions.

TOTAL CANADA OIL & GAS LTD.,

Calgary, is seeking a new name after completion of a share sale by former parent Total. Total sold 18.8 million shares of a secondary offering in the Canadian unit for $183 million (Canadian). The shares represent about 53% of Total Canada stock. Total Canada, in operation since 1955, produces about 9,500 b/d of liquids and 70 MMcfd of gas. Employees of the now independent operation have suggested about 400 new names for the company.

COGENERATION

CANADIAN UTILITIES LTD.

and Suncor Inc. agreed to jointly develop, own, and operate a cogeneration plant to provide steam and electricity to Suncor's oilsands operation near Fort McMurray, Alta. The plant, to cost about $270 million, will replace Suncor's existing steam and electric plant. The new unit will use fluidized bed combustion to reduce sulfur dioxide emissions from Suncor's operation by at least 75%. The plant is expected to reduce operating costs by $30-40 million (Canadian)/year, or about $1.50/bbl. It is to be commissioned in mid-1996.

DRILLING-PRODUCTION

YEMEN

asked Hunt Oil Go., Dallas, to shut down its operation in Yemen. Yemeni Oil Minister Saleh Abu Bakr bin Hussainoun warned Hunt he could not guarantee the safety of its 300 expatriate staff following a spate of kidnappings and hijackings in the country. A Hunt spokesperson said, "Our operations managed by Yemen Hunt Oil Co. have continued without interruption." Hunt accounts for 170,000 b/d of the country's 200,000 b/d oil production.

A GROUP

led by C. Itoh Energy Development Co. Ltd. bought interests in three North Sea fields from Enterprise Oil plc for $106 million. Included are a 25.769% stake in Hudson field on Blocks 210/24a and b, due on stream this year (OGJ, Jan. 25, p. 48), an 8.633% stake in Hutton field on Block 211/27b, which averaged 21,000 b/d of oil last year, and a 25-769% interest in Northwest Hutton field on blocks 221/27a and c, which averaged 10,000 b/d of oil last year and is to cease production next year. It is the first upstream venture by C. Itoh in the U.K. North Sea.

DEMINEX U.K. OIL & GAS LTD.

bought interests in 17 North Sea blocks from Lasmo plc for 105.8 million ($158.7 million). The deal includes Lasmo's share in Bruce field, the Keith prospect, a 25% stake in Pine and Birch prospects, and Lasmo's share of the Fiddich, Monan, Mungo, and Orion prospects. Pentex Oil Ltd., Aberdeen, bought Lasmo's share of Balmoral, Glamis, Maureen, and Moira fields, plus the Stirling prospect, for 20.7 million ($30 million). Lasmo said the sales represent reserves of 65 million bbl of oil equivalent.

LASMO

signed contracts with Pakistan and Sui Southern Gas Co. for the sale of gas from Kadanwari field, where reserves are estimated at more than 700 bcf. The field, due on stream early in 1995, is expected to meet about 10% of Pakistan's gas consumption.

PHILLIPS PETROLEUM INTERNATIONAL CORP.

let contract to Production Management Industries Inc., Harvey, La., for design and fabrication of five electrostatic oil treaters to be used in Phillips' ship shaped floating production, storage, and offloading unit in Xijiang field off China. The treaters, to be delivered in May, are designed for oil desalting and dehydration service.

ARAKIS ENERGY CORP.,

Vancouver, and State Petroleum Corp., Richmond, B.C., are preparing a project document with Sudan's General Petroleum Corp. that will specify initial costs to develop 60 million acres of oil concessions in the country. Arakis and State are acquiring development rights on the concessions, where they peg proved reserves at 280 million bbl. The project document specifies costs to bring the project into initial production at 40,000 b/d, but full production is estimated to reach about 300,000 b/d.

U.S. DEPARTMENT OF ENERGY

plans to revise its solicitation for the sale of natural gas from the Elk Hills Naval Petroleum Reserve in Kern County, Calif. In a Feb. 25 solicitation it plans to shift from the current unindexed, 4 month, fixed price contract to a 6 month contract under which a buyer will pay its bid price, adjusted by a monthly index factor.

NICOR INC.,

Naperville, Ill., is exploring the possible sale of its oil and gas operations conducted by Nicor Oil & Gas Corp., Denver. The oil and gas unit has operations mainly in the Anadarko and Arkoma basins of Oklahoma and the Gulf Coast area of Texas and Louisiana. The company's reserves and production are about 80% gas and 20% oil. In 1992 the operations had revenue of $58 million and operating cash flow of $44 million. Petrie & Parkman Co., Houston, will assist in the process.

NORTH COAST ENERGY INC.,

Cleveland, signed a memorandum of understanding with Pakistan's Oil & Gas Development Corp. for an oil recovery project in Pakistan's Toot oil field. Toot field's Dalta formation has produced 10.8 million bbl of oil of an estimated 132 million bbl originally in place. North Coast expects to increase recovery from the Dalta and evaluate other formations.

CHEVRON U.K. LTD.

let a 12 million, 5 year contract to Bibby Line, Liverpool, to operate the floating storage unit in Alba oil field in North Sea Block 16/26. Chevron expects to begin production from Alba late this year. Flow is to peak at 60,000-70,000 b/d from reserves estimated at 400 million bbl.

GRANT TFW INC.,

Navasota, Tex., and Arosco U.S.A. Inc., Houston, completed an order for 252,000 ft of G-105 drill pipe for a Russian production association. The pipe will be shipped Feb. 17 to Kaliningrad, then transported to Russian oil fields.

SPR

DOE

will buy 2.375 million bbl of crude for storage in the Strategic Petroleum Reserve, bringing the stockpile to about 577.3 million bbl. It will buy 1 million bbl of Oseberg crude from Statoil North America at $18.43/bbl, 1 million bbl of Brent crude from Morgan Stanley at $18.35/bbl, and 375,000 bbl of Neuquen Rio Negro crude from Petrolea Oil Corp. for $17.70/bbl. The U.S. Military Sealift Command will arrange for tanker shipment of the oil to SPR sites, with deliveries beginning this month.

TRANSPORTATION

JAPAN'S

Nippon Steel Corp., Kawasaki Steel Corp., Sumitomo Metal Industries, and NKK Corp. concluded contracts with Russia's Gazprom to supply $200 million worth of steel pipe, including 200,000 tons of large diameter pipe and 100,000 tons of seamless pipe. The contracts are part of the $700 million export contracts agreed to, which Japan's Ministry of International Trade and Industry will insure (OGJ, Oct. 12, 1992, p. 26).

GAZPROM

let a 7 year contract to Compressor Controls of the U.S. to deliver $50 million worth of monitoring equipment to enhance the efficiency of Gazprom's natural gas pipelines and gas processing plants. The contract is expected to save 350-500 bcf/year of gas currently lost due to inefficient equipment.

TRANSCANADA PIPELINES LTD.,

Calgary, and ANR Pipeline Co., Houston, plan to lay a 200 mile gas pipeline from the Iroquois system at Canajoharie, N.Y., through southern Vermont to Boston. Initial capacity will be 350 MMcfd. Estimated cost of the Mayflower pipeline project is $320-360 million. It is expected to be in service in 1996. The companies said they expect the project to include other partners.

CHASE TRANSPORTATION CO.

(CTC), a 50-50 partnership of Koch Industries Inc., Wichita, and Texaco Inc., plans to expand its petroleum products pipeline service to Colorado Front Range markets from its El Dorado, Kan., origin. CTC will replace about 46 miles of 8 in. line in Kansas with 10 in. line, allowing delivery of an added 25.000 b/d of products to the Front Range. The project is to be complete by second quarter. CTC also approved construction of about 18 miles of line from its Aurora, Colo., terminal to the new Denver airport. The line will supply all the jet fuel needs for the airport and will connect to most sources of jet fuel supplying the Denver area.

CZECH REPUBLIC'S

Chemopetrol Litvinov and Kaucuk Kralupy formed Mero-IKL Ltd., Prague, to lay and operate a crude oil pipeline from Ingolstadt, Germany, to Kralupy. The pipeline will be about 340 km long with nameplate capacity of 220,000 b/d. Plans include expanding the line to 330,000 b/d after 2000. The line will supply the Czech refining industry and provide an alternative to Russian supplies. Construction is to be complete in 1995.

REFINING

OIL, CHEMICAL, AND ATOMIC

WORKERS INTERNATIONAL

union reached agreement with Unocal Corp. on labor contract issues specific to the San Francisco Bay area, where a strike had been threatened early this month (OGJ, Feb. 8, p. 34). Contract talks continue on local issues with other bay area refiners, as well as with other refiners across the U.S.

ALLIEDSIGNAL INC.,

Morris Township, N.J., is launching a new business for recovering potassium fluoride, normally lost in the manufacture of high octane gasoline, and using it to manufacture potassium hydroxide for the refining industry and aqueous hydrofluoric acid. The process uses AlliedSignal's Aquatech technology. The company will invest $15 million in an expandable plant in Baton Rouge, La., which is to start up in the third quarter. Amoco Oil Co. in Texas City, Tex., has signed as a charter customer.

ULTRAMAR INC.

let a contract valued at about $45 million to Fluor Daniel Inc. to provide engineering, procurement, and construction management services for the first of a multiphase clean fuels program at its 68,000 b/d Wilmington, Calif., refinery. Scope of work includes constructing units to remove sulfur, benzene, and other impurities, as well as modifications to utilities and existing facilities. Construction is to begin in mid-1993, aiming for completion late in 1994.

CHEVRON U.S.A. PRODUCTS CO.,

responding to an employee suggestion, agreed to begin releasing treated waste water from its 244,000 b/cd El Segundo, Calif., refinery through an unused pipeline extending 3,500 ft from the plant into Santa Monica Bay, more than 10 times farther than the line currently used for the purpose. Cost of modifying the new line for wastewater discharge is estimated at as much as $2 million. Chevron expects to obtain permits in time to complete the changeover early in 1994.

SPILLS

BRIGGS MARINE

ENVIRONMENTAL SERVICES LTD.,

Aberdeen, bought BP Exploration Operating Co. Ltd.'s oil spill response center at Dundee, Scotland. At the same time, BP hired Briggs to provide a spill reponse service for its North Sea operations. Briggs operates two pollution control vessels.